Josh Marshall

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Josh

Talking Points has received a secret internal memorandum from Presidential Advisor Karl Rove, relative to the visit of interim Afghan leader Hamid Karzai.
TPM releases it here for the first time.

1/27/02
From: Karl Rove
To: Card, Hughes, Fleischer, Rice

#43's nicknaming has always been a good thing for us. Polls well. Works very well in the red states. But the recent Ken Lay stuff could hurt us ("Kenny-Boy" etc.). Believe me, I think it has legs. I think it's imperative we come into the SotU with an outta-the-park nickname the president can use for Hamid Karzai. Here's what I've come up with.

1. Hammy, Hammy-Boy, 'big ham.' Discussion: This works really well. Rolls off the tongue. The sorta thing #43 might come up with on his own if he weren't so busy. But there's a problem. According to smarties at State Department, Muslims don't go in for ham and don't even like talking about it. Could offend. This always seems to be a problem with them. (Remember 'Operation Infinite Justice'? Ouch!) You wish this were the one. But apparently it's a no-go. Ideas?

2. 'The Ham-ster' â¦ Discussion: Again. Works well. Rolls off the tongue. #43 would get right to it. However, it may sound like the rodent, which could be demeaning, but also might be endearing since hamsters were a popular pet in the 1970s and 1980s when Karzai, I'm told, spent some time in America. Could Muslims have same 'issues' with rodents as with pigs? (Note: Don't go to State with this. Someone check this with Grover Norquist. He may know.)

3. 'Yo-Hamid' â¦ Discussion: I like this. I like it A LOT. Sounds eerily like Mo-Hamid (i.e. Mohammed) who is extremely popular among Muslims around the world. Also, this could be a two-fer. Could help on minority-outreach, inclusion, 'uniter not a divider' front. (Yo, yo, yo... etc.)

4. 'Kar-man', 'Green Hat', 'Greenie', 'Caped Crusader.' Any thoughts on any of these? I just came up with them at the end.

As TPM reported back on December 6th, there was always major controversy within the law firm of Morrison & Foerster over its decision to represent American Taliban fighter John Walker Lindh. Now, according to this article, the firm has removed its name from the representation and the case is being conducted under the names of the attorneys handling Walker's defense. (The lead attorney is MoFo partner James J. Brosnahan.)

Now, however, TPM can reveal a heretofore unreported element of the controversy -- a fact, at first at least, not even revealed to many partners in the firm.

Morrison & Foerster not only agreed to take Walker's case. From the beginning, they agreed to do so pro bono.

For all the stuff I've seen about Enron, nothing has shocked me more than what I'm about to describe.

You may already had read that the Florida state pension fund took a bath on Enron stock. The fund owned 7.6 million shares of Enron stock totalling roughly $300 million.

But according to this editorial in the St. Petersburg Times, "nearly a third of the state's 7.6-million shares were bought after Oct. 22."

That's shocking.

If you look at this chart of Enron's stock decline last year, you'll see that October was the month that Enron stock went into complete free-fall. On October 16th, Enron announced a $1.2 billion decrease in company value. On October 22nd, the SEC announced an investigation of the company. And the next day, October 23rd (unbeknownst to the public, at least) Andersen kicked the document shredding into overdrive. Though the formal bankruptcy came later, October was the month that Enron fell through the floor.

Ok, sure, they say 'buy on the dips.' But is there any reasonable explanation why a pension fund would invest $100 million in Enron as it was heading into its death spiral? I can't imagine what that explanation would be.

This AP article portrays it as a case of hindsight being 20/20 and the persistent power of misplaced trust in Enron. But I'm not sure that's credible. Nor does the Florida AG, who is considering filing a RICO suit.

Who's responsible? That's not clear. But there are some intriguing clues.

One of the three trustees of the Florida pension fund is Governor Jeb Bush. But there is as yet no evidence that he acted as anything more than a passive overseer. The actual decision-making was coming from the private company managing the state's money.

U.S.-based institutional client sales and marketing for Alliance Capital is directed by Roger Hertog, a major funder of conservative causes, a major contributor to the Republican party, and apparently also a friend of Ken Lay.

If you go look at the just-released updated list of administration appointees who owned Enron, you'll notice that George Argyros' name is at the top of the list.

Now, I'll grant you, that's mainly because his name starts with 'A'. Even so, let's talk for a moment about George Argyros, Ambassador Extraordinary and Plenipotentiary of the United States of America to Spain and Andorra.

It's not just that Argyros owned between $100,000 and $250,000 of Enron stock, which in itself isn't a bad thing. Nor that he bought his ambassadorship for $130,000. Not even that he's considered a notorious slumlord in his haunts in Southern California.

No, what's really bad about George Argyros is that he's apparently an incorrigible egomaniac and pitiful self-promoter who's probably making us look bad to most Spaniards.

If you look at Argyros' biography on the US Embassy in Madrid website, you'll see a "Partial List of Awards Received" numbering twenty-five in all. These include, and I quote, such honors as ...

"Heart Award", presented by the Costa Mesa Chamber of Commerce, in recognition of all his years of community service and philanthropic contributions. (1987)

"Paul Harris Fellow Award", presented by the Orange Rotary Club on behalf of the Rotary Foundation of Rotary International, in appreciation of tangible and significant assistance given for the furtherance of better understanding and friendly relations between peoples of the world. (1990)

Inducted into the Horatio Alger Association of Distinguished Americans, perhaps the single most coveted award given in American (sic) to non-military, non-show business individuals. (1993)

Recipient of the American Academy of Achievement Golden Plate Award, honoring him as a representative of the many who excel in his chosen profession. (1996)

Inducted as Chairman of the Horatio Alger Association of Distinguished Americans. (1998)

Recipient of Manager of the Year Award presented by Society for Advancement of Management, California Chapter. (2001)

Glad he didn't have to scrape the bottom of the barrel or anything.

What American can hold his or her head high in Spain if this goofball is our Ambassador?

Here's your updated list of administration appointees (Senate-confirmed and otherwise) who either owned Enron stock or had some other relationship with the company. It supercedes the earlier list we published on January 2nd and has eight new names.

Let's stipulate again that most of these folks disclosed Enron assets in the one-thousand to fifteen-thousand dollar range and probably just had Enron as some obscure line-item in their investment portfolios. Others had much more. (Remember: the employees who lost their shirts because they had Enron-heavy 401(k)s had a piece of the 'ron too. And they're victims, not perps.)

In any case, the data speaks for itself and is provided as such.

Appointee: George L. Argyros
Title: Ambassador Extraordinary and Plenipotentiary of the United States of America to Spain and Andorra
Department: State
Relationship: Enron Stock $100,000 - $250,000; $1,000 - $15,000

Arthur Levitt, former head of the SEC, tried but failed to prevent accounting firms from being accountants and consultants for a single firm. That might (stress might) have made a difference with Enron. In any case, after Enron, it now looks like a pretty good idea.

In The Hill, Alexander Bolton nicely untangles the web of money contributions and Washington hardball that led thirteen Senators to bully Levitt into backing off.

Possibility #1: There's really nothing in the ETF notes, the White House has a deep ideological belief in executive branch privilege and thus secrecy (which is clearly true). On principle, on separation of powers grounds, they're resisting encroachments from the Congress.

End Game: The administration is eventually compelled to turn over the notes, either politically or judicially. Nothing bad is revealed, but the period of resistance fuels and continues the Enron cloud over the White House, perhaps even creating the investigative pressure that unearths other things we don't know about. It keeps Enron as an issue deeper into election season. The fact that nothing was found in the notes after all doesn't undo the damage. That's reported in Section L, page 79 of the The New York Times.

Possibility #2: There's really nothing in the ETF notes, but the White House has made a strategic decision to resist ceding the investigative initiative to the Congress and realizes that this is where it has to make its stand.

End Game: See end game for #1 (above).

Possibility #3: There's nothing illegal revealed in the ETF notes, but they describe a hand-in-glove closeness between the administration and energy companies, particularly Enron, that will be deeply embarrassing.

End Game: The administration is eventually compelled to turn over the notes, either politically or judicially. The period of resistance fuels and continues the Enron cloud over the White House, perhaps even creating the investigative pressure that unearths other things we don't know about. Weeks or months of resistance amplify the damage of the embarrassing revelations.

Possibility #4: It's really as bad as you can imagine. The notes reveal either illegal acts (which I find hard to believe) or one of the following: a) foreknowledge of Enron's problems, b) a direct nexus between money contributions and efforts to help Enron, c) various bad stuff that will lead heavyweights to resign.

End Game: The administration is eventually compelled to turn over the notes, either politically or judicially. Various people end up doing time or resigning their appointments. It was a good strategy because they had to keep the information secret if they could. It just didn't work.

My money is on a possibility #3, with #1 and #2 thrown in for good measure.

Regulars readers will remember that the first TPM Enron post way back on November 29th took aim at the company's fabulously arrogant "ask why" corporate ad campaign. That was the ad campaign featuring the 'metalman' commercial and the annoying computer-voice 'why, why, why, why' trailer. It even had its own website, askwhy.com.

Well, hopefully you took a look at the links while they were available.

"In the wake of Enron's collapse, it has become apparent that many financial firms â from Enron's lenders to Wall Street bankers who underwrote the company's partnerships to investment houses that bought into them to the accountants who reviewed their books â knew more about Enron's condition than the company publicly disclosed."

That's one of the key grafs in a fascinating article in today's New York Times which describes how Veba, a German utility company considering a merger with Enron, was able to piece together a picture of the company's rickety financial footing with only a relatively cursory investigation based on publicly available documents.

"We were wondering why this wasn't common knowledge, or why it wasn't discovered by those people whose business it was to discover these things," one of the analysts told the Times.

It's starting to seem like Enron's condition was, if not an open secret, then at least a secret that was hidden in something like plain view. Many apparently knew at least some of the key details. And perhaps knew enough to know not to know more.

Questions one, two, three and four are each 'who leaked the memo revealing that Colin Powell - alone among the president's top military and judicial advisors - wants the al-Qaida and Taliban prisoners classified as prisoners of war under the Geneva Convention'.

Who got the leak, Bill Gertz and Rowan Scarborough at the Washington Times, gives a pretty clear idea which side of the debate did the deed. But who precisely? The Pentagon, the Counsel's Office, Condi's people at the NSC, or perhaps one of the very key people in the office of Vice President Cheney?